Woodbois Limited 2020 cash flow enhancement and additional funds (9516Z)
16 Enero 2020 - 1:00AM
UK Regulatory
TIDMWBI
RNS Number : 9516Z
Woodbois Limited
16 January 2020
16 January 2020
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014.
Woodbois Limited
("Woodbois", the "Group" or the "Company")
(AIM: WBI)
2020 cash flow enhancement and additional funds to assist
trading growth
Woodbois, the African focused forestry and timber trading
company, is pleased to provide an update regarding certain cash
enhancement measures for 2020, set out below, that have been agreed
upon with various stakeholders in order to accelerate the Company's
growth as it moves toward a cashflow positive position during
2020.
Paul Dolan (CEO) commented, "Following our statement of record
quarterly and annual revenues for 2019 on 7 January, I am now
pleased to be able to detail important cash-management measures
which will allow the Company to enter the new decade in a stronger
position as we move towards generating sustainable positive
cash-flow. The deferral by a year of the 2020 acquisition purchase
payments by our senior management team is an important statement of
support for, and confidence in, the fundamental strength of our
business. I am grateful to the team, and also to our largest
stakeholders for demonstrating their commitment to strengthening
the Company's working capital position. This will assist our
ability to continue to pursue growth opportunities and maintain our
proven trajectory of rapid growth."
Deferred Consideration re Acquisition of Woodbois in 2017
On 24 May 2017 the Company (previously known as Obtala Limited)
announced the acquisition of Woodbois International ApS (and
subsequently changed the Company name to Woodbois Limited). The
terms of the acquisition provided for deferred cash consideration
of US$5.0m, payable in equal quarterly payments over 5 years,
commencing 30 September 2017. The Company has agreed with the
vendors, Zahid Abbas, Jacob Hansen and Hadi Ghossein or companies
wholly owned and controlled by them, each a Director of the
Company, to defer payments totalling $1.25m by a year, being the
quarterly payments for the period from 1 January 2020 to 31
December 2020, following which quarterly payments will resume on 31
March 2021.
Internal Trading Fund ("ITF")
1798 Volantis Fund Limited ("Volantis"), a fund managed on a
discretionary basis by Lombard Odier Asset Management group
("Lombard"), will provide an additional US$1.0m through investment
into the Group's ITF ("Additional Loan") by way of an additional
loan agreement with Woodbois Trading Limited, a wholly owned
subsidiary of the Group. The Additional Loan funds may also be
utilised for general working capital purposes.
The Additional Loan is on similar terms as the US$5.0m already
invested in the ITF by Volantis, announced on 10 January 2019, with
an interest coupon of 11.5% per annum to be paid semi-annually. The
Additional Loan may be recalled by Volantis at any time and is
repayable on 20 January 2021.
Furthermore, Africa Resource Investment Limited ("ARI") has
agreed that, in respect of its existing $5.0m ITF loan, it will not
request any withdrawal prior to 31 December 2020.
In addition, each of Volantis and Paul Dolan, Chief Executive,
have indicated their intention to receive Woodbois ordinary shares
("Shares") in lieu of interest (at 11.5% pa) for the period from 1
July 2019 to 31 December 2020 in respect of their ITF loans. A
further announcement will be made in this regard.
Convertible Bond interest
In connection with the Company's 4% convertible bonds 2024
("Bonds"), issued on 21 October 2019, Pelham Limited (a company
controlled by Miles Pelham) and Paul Dolan have agreed to roll up
interest payments due for the period from issue until 31 December
2020 on an aggregate $20.4m of Bonds. These agreements (the "Bond
Interest Agreements") are for $20.0m of Bonds held by Miles Pelham
and $0.40m of Bonds held by Paul Dolan. In the event such Bonds
remain unconverted as at 31 December 2020, the rolled-up interest
would result in the issue of approximately $0.98m additional Bonds
at that time.
As detailed in the Company's announcement of 20 September 2019,
the Bondholders are deemed to be a concert party for the purposes
of the Takeover Code. In order to avoid an inadvertent breach of
Rule 9 of the Takeover Code, Pelham Limited has undertaken to the
Company that its aggregate interest (as defined in the Takeover
Code) in Shares, when aggregated with all Shares which have been
issued to (and are still held by) any other Bondholders; and all
other Shares in which the other Bondholders are interested (as
defined in the Takeover Code) and in respect of which the Company
is aware (having made all reasonable enquiries), will not at any
time exceed 28.0% of the enlarged issued Share capital of the
Company. This undertaking remains in force.
Related Party Transactions
Volantis is a substantial shareholder of the Company.
Accordingly, the Additional Loan is classified as a related party
transaction under the AIM Rules for Companies. The independent
directors (being all the directors other than Henry Turcan, who is
an employee of Lombard and so is precluded from taking part in
deliberations), having consulted with Arden Partners, nominated
adviser, consider that the terms of the Additional Loan are fair
and reasonable insofar as shareholders are concerned.
Miles Pelham is a substantial shareholder of the Company and
Paul Dolan is CEO and a director of the Company. Accordingly, the
Bond Interest Agreements are deemed to be related party
transactions for the purposes of the AIM Rules for Companies. The
independent directors (being all the directors other than Paul
Dolan), having consulted with Arden Partners as its nominated
adviser, consider the terms of those transactions are fair and
reasonable insofar as shareholders are concerned.
Enquiries:
Woodbois Limited
Paul Dolan - CEO
www.woodbois.com
+44 (0)20 7099 1940
Arden Partners Plc (Nominated adviser and broker)
Richard Johnson
+44 (0)20 7614 5900
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END
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